Securities Lawyers Blog
According to records kept by The Financial Industry Regulatory Authority (FINRA) financial Broker Marcello Lattuca (Lattuca), currently associated with Nbc Securities, INC., has at least 3 disclosable events. These events include 3 customer complaints, alleging that Lattuca recommended unsuitable investments in different investment products including debt securities among other allegations and complaints.
FINRA BrokerCheck shows a settled customer complaint on May 20, 2020.
CLAIMANTS ALLEGE UNSUITABLE RECOMMENDATIONS, FRAUDULENT MISREPRESENTATION, CHURNING, BREACH OF CONTRACT, NEGLIGENT SUPERVISION, AND BREACH OF FIDUCIARY DUTY. \<char_lb_r>\, EXACT DATE OF EVENTS IS NOT KNOWN BUT IS FROM PRIOR TO THE RR’S CURRENT EMPLOYMENT DATE AND CONTINUED THROUGH MARCH 2020.
FINRA BrokerCheck shows a settled customer complaint on May 19, 2020.
Claimant alleges unsuitable recommendations, fraudulent misrepresentation, churning, breach of contract, negligent supervision by the firm, breach of fiduciary duty, and elder abuse. Exact date range is unknown, but is alleged to be from 2012 through May 2020.
FINRA BrokerCheck shows a settled customer complaint with a damage request of $500,000.00 on May 15, 2020.
Claimants allege unsuitable recommendations, fraudulent misrepresentation, churning, breach of contract, negligent supervision by the firm, and breach of fiduciary duty. Exact dates are not provided, but the complaint alleges the clients met the rr in 2013 while he was employed by jhs. Clients transferred their accounts from nbc securities in March/April 2020.
In the financial industry advisors must meet the requirements of the SEC’s Regulation Best Interest (Reg BI) in providing investment advice and services. Reg BI established a ‘best interest’ standard for brokerage firms and registered representatives. This standard applies when brokers make recommendations to retail customer for any securities transaction or investment strategy involving securities, including recommendations of types of accounts. This Reg BI standard of care applies to registered representatives making recommendations to customers in the purchase, sale, or exchange of securities or the implementation of investment strategies involving securities and non-securities. The rule also applies to the handling of opening accounts such as account transfers and types of accounts being recommended to be opened.
Another aspect of the care obligation is focusing on the client’s specific needs which brokers must reasonably understand through obtaining information for the client’s investment profile. In completing a customer’s investment profile the advisor should include information such as the investor’s investment time horizon; liquidity needs; risk tolerance; experience with various investment vehicles; investment objectives and financial goals; assets and debts including outside investment accounts; marital status; tax information; age; and other relevant information that may be individual to the investor that the advisor would need to know to properly render advice or provide services. Reg BI is drawn from fiduciary principles that include an obligation to act in the retail investor’s best interest and the broker is prohibited from placing their own interests ahead of the investor’s interest. There are different sub-parts of the Reg BI rule that financial professionals must comply with when providing advice. Among those is the duty of care obligation that mandates associated persons to evaluate investment options, review and be knowledgeable the risks and rewards of the investment or service, compare alternative investment products, and ensure that the overall investment strategy aligns with the client’s goals and is in their best interests.
Next, the broker must understand the investor’s investment background and profile. A customer’s profile includes information that describes the investor’s financial situation and needs. Information here will include their outside securities accounts and investments; relevant assets and debts; tax bracket; age; liquidity needs; risk tolerance; investment time horizon; experience with investing; investment objectives; and any other relevant information that the investor may choose to disclose pertinent to their situation. Using the foregoing information, the associated person then must consider reasonably available investment option to accomplish the investor’s goals as well as alternative investment options that may be cheaper or other important qualities. Finally, the advisor must conclude that there is a reasonable basis to believe that the recommendation being provided is in the investor’s best interest. Brokerage firms and advisors must also understand the features and limitations of various account types as part of meeting Reg BI’s care obligations. Firms typically offer a variety of account options and services with different trading costs, services, such as account and activity monitoring. An advisor’s recommendation as to what type of securities account to open can alter the customers’ overall costs and investment returns. The advisor must determine that the client can benefit from the type of account being recommended to be opened and in the investor’s best interest taking into account the costs, benefits, and needs of the client.
Lattuca entered the securities industry in 1991. Lattuca has been registered as a Broker with Nbc Securities, INC. since 2015.
Investors who have suffered losses are encouraged to contact us at (800) 810-4262 for consultation. At Gana Weinstein LLP, our attorneys are experienced representing investors who have suffered securities losses due to the mishandling of their accounts. Claims may be brought in securities arbitration before FINRA. Our consultations are free of charge and the firm is only compensated if you recover.